Claremore Daily Progress


October 4, 2013

NFL: $2,500 average for seat rights in Vikings stadium

MINNEAPOLIS — Getting into the Minnesota Vikings' glitzy new stadium will come at a high cost for some fans: an average of $2,500 for the right to buy a season ticket in the new building.

The ticket licenses cover three-quarters of the building's 65,000 seats, the Minnesota Sports Facilities Authority revealed Thursday. They're a key part of two agreements that won quick approval from the public authority. One covers how the stadium will be financed and built, the other how operating costs and revenue will be split over a 30-year lease.

State taxpayers are paying $348 million toward the nearly billion-dollar stadium, with the city of Minneapolis putting up $150 million. The Vikings are responsible for $477 million.

The seat licenses are expected to generate $100 million toward the Vikings' share of building costs. They will range in price from as low as $500 to $10,000, with choice seats at the higher end. Fans will have three years to pay the cost without interest. If they need longer, they can take up to five more years but will have to pay interest.

The agreements don't cap what the Vikings can charge for tickets. They must make available 3,250 "affordable'' tickets for each game, but the agreement leaves it unclear what those will cost.

The potential cost of the seat licenses was a flashpoint as the agreements were negotiated, with Gov. Mark Dayton warning the team against excessive fees for what he had billed as a "people's stadium.''

The authority said Minnesota's seat license program would cost fans less overall than those in other NFL markets. They pointed to recent stadium deals in Dallas, New York and San Francisco that all raised $400 million or more through the license sales.

"I can safely assume that for most Minnesotans this will look like a questionable deal because the economics of professional sports are highly questionable all over this country,'' Dayton said Thursday. He called the stadium "a magnet'' for further economic development.

"We had to make a deal. We had to get the owners of the team to agree to a deal,'' he said.

Authority chairwoman Michele Kelm-Helgen said the seat license was the final issue in reaching contract agreements. She said Minnesota's approach would differ from those implemented in other cities, but she still expected a backlash.

"Having a program in and of itself is going to make a lot of people angry,'' she acknowledged. But she said the cost is lower than what the Vikings had sought and if the sales program falls short of expectations the Vikings would be on the hook.

Lester Bagley, a Vikings vice president, said the team was pleased with the agreements that emerged from "hardnosed'' negotiations.

These are "significant milestones,'' Bagley said. "Now we can move forward to construction, breaking ground.''

Team officials said fan surveys show most loyal ticketholders would have been willing to pay even more for the seat licenses.

In addition to the seat licenses, the Vikings are also tapping into an NFL loan program for $200 million. The team's owners will cover the remaining costs through borrowing and through a $100 million cash contribution. They might be able to recoup costs in part with annual naming rights revenue. A naming rights deal hasn't been announced.

The agreements bind the team to a lease of 30 years or more. Once the stadium opens, Kelm-Helgen said the team will pay the authority $8.5 million in annual rent and put $1.5 million into a capital improvement fund each year, with both payments rising over time.

The authority will keep concession revenue from nonfootball events as well as any money that comes in from stadium tours. In Dallas, hundreds of thousands of fans have paid $20 each to tour that new stadium.

Seat licenses - known as charter ownership agreements in some cities - began taking off with sports stadium construction in the mid-1990s. They've become particularly rooted with NFL teams; more than a dozen of the league's 32 teams have them in some form already.

The seat licenses become the property of the purchaser, allowing fans to sell the rights when they no longer want season tickets. The resale market can be lucrative. In Pittsburgh, for instance, fans who bought a seat license for a stadium that opened in 1998 averaged a roughly nine-fold return when selling it a decade later, according to online seat license broker STL Marketplace. But in cities where the team has struggled, Tennessee and St. Louis among them, fans have suffered losses when they have tried to dump their licenses.

The pair of Minnesota stadium agreements is part of a fall ramp-up for the project. By next month, the state hopes to select banks that will facilitate a bond sale to pay construction costs.

In early November, Vikings owners and politicians expect to gather for a ceremonial groundbreaking and significant construction will begin within weeks.

The Vikings are playing their final season at the 32-year-old Metrodome. They'll move to the University of Minnesota's on-campus stadium for a couple of seasons. If all goes as planned, their new stadium will open on the old Metrodome site in time for the 2016 season.

Critics of the project aren't going quietly.

In a public comment period after the contracts were approved, the authority got an earful from stadium opponents who said taxpayers were getting a raw deal. One of them, Jeff Wagner, threw his shoes on a table and left them there.

"You can keep my shoes because basically you are just stealing from the people,'' said Wagner, one of 35 fall candidates for Minneapolis mayor.


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